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Re: Heavy Market
In Response To: Heavy Market *PIC* ()

Hi Latam. The COT report may be perceived as bearish but not for the increase in managed money shorts, IMO. This is the bullish factor of the COT. In fact they began buying Friday and they continued today. As you know the systems funds have a trigger to buy and sell. Their buy trigger was engaged at around 129.50 on Friday. We will see that the OI will be down for today indicating short funds buying and longs selling. The long selling is the bearish part of the report. Today both sides were relentless. These dynamics will continue and the market will likely move higher with a great deal of resistance. Like the last two rallies that we experienced, at some point some sector will sell the market down, hitting stops and reversing the systems once again. I believe that their trigger sell point is between 127.00 and 126.50. At this point the cycle will begin again. There were several unfilled bids in the forward months before we rallied and they are still resting orders. It is a sad commentary but the systems game is the only action in town. Fundamentals I believe are on the side of the bulls. As Flavio shows in his maps, soil moisture is negative. I read a report today that rains are unusually diminished. We are waiting to get some solid indicators of the damage, if any, as a result of broca and defoliation. What do you think about crop conditions and projections on ‘18’19? I admit that the market is fragile but it may not yet be ready to crack. GT

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